What if some beneficiaries of a trust material participated but some did not?

[asemco1616]

For beneficiaries who materially participate, would I put their share of the trust's ordinary business income on K-1 Line 5 (Other Portfolio and Nonbusiness Income), and for those who did not materially participate, would I put their distribution on Line 6 (Ordinary Business Income)?

[tagteam · Accepted solution]

"What if some beneficiaries of a trust material participated but some did not?"

Partially answered in a response to your other question. Again, read through the ABA comments (link below), particularly those starting on page 21.

http://www.americanbar.org/content/dam/aba/administrative/taxation/policy/012015comments.authcheckda...